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On the EUR/JPY cross, a rally was witnessed yesterday – in the context of a downtrend. The rally is supposed to be a wonderful opportunity to sell short at better prices, as the market could go downwards again. The demand levels at 126.00, 125.50 and 125.00 would eventually be tested.

There is a Bearish Confirmation Pattern in the market. The EMA 11 is still below the EMA 56 and the RSI period 14 is below the level 50. This is a bear market, and long trades are not currently logical, owing to a measure of stamina in JPY.

Nothing significant has happened since Wednesday. The pair has been trending downwards and there is now a lot of trading activities around the demand level at 108.50. An expected strong movement could favor sellers.

This market has been going gradually downwards (a movement that was started early last week). Price is now below the resistance level at 0.9900 and it may reach the support levels at 0.9850, and another support level at 0.9800, which would most probably favor bears. However, a strong selling pressure is needed for the support level at 0.9800 to be reached.

A continuation of the bearish movement is expected today or tomorrow. There is a Bearish Confirmation Pattern in the market, and the bias is bearish. The Williams' % Range period 20 is almost into the oversold region.

Technical Outlook :Our all downside target which we predicted in yesterday's analysis have been hit. The pair remains on the downside, capped by its falling 50-period moving average. Furthermore, the relative strength index is bearish below its neutrality area at 50, without showing any reversal signal. Last but not least, the key resistance at 1.2930 maintains the strong selling pressure on the prices. To conclude, as long as 1.2930 is not surpassed, look for a return to 1.2815 and 1.2785 in extension.

Fundamentals:

Canada's economy expanded at a slower pace than expected in the first quarter, as housing investment dropped sharply. Weaker consumer spending and lower exports of non energy products also weighed on growth.

Canada's gross domestic product, or the broadest measure of goods and services produced in an economy, rose at a 1.3% annualized rate in the first quarter of 2018, to 1.877 trillion Canadian dollars ($1.455 trillion). The gain matched an earlier forecast by the Bank of Canada, but fell short of market expectations for a 1.9% advance, according to economists at Royal Bank of Canada.

Chart Explanation: The black line shows the pivot point. Currently, the price is above the pivot point which is a signal for long positions. If it remains below the pivot point, it will indicate short positions. The red lines show the support levels, while the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Our first target which we predicted in previous analysis has been hit. The pair posted a strong rebound yesterday, and is expected to challenge its next resistance at 0.7030. The 50-period moving average is turning up now, and should act as a strong support role. In addition, the relative strength index is bullish above its neutrality area at 50. In which case, as long as 0.6965 is not broken, likely advance to 0.7030 and 0.7050 in extension.

Fundamental outlook:

Earlier today New Zealand business confidence and firms' views of their own activity eased 4 points in May, with a net 27% of businesses now pessimistic about the year ahead. Companies' views of their own activity dipped to +14, the lowest since November. New Zealand business confidence has softened, sending a warning signal to the still fledgling center-left government. It seems there is plenty to worry about with ANZ's measure of business confidence sinking toward the cycle lows after last year's election.

Chart Explanation: The black line shows the pivot point. Currently, the price is above the pivot point which is a signal for long positions. If it remains below the pivot point, it will indicate short positions. The red lines show the support levels, while the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Bitcoin (BTC) has been trading upwards. The price tested the level of $7.563. Averaging more than a million onboardings per year, Philippines' Coins.ph announced it reached a whopping five million users this week for its mobile payments application (app) and hot crypto wallet. Not content with merely adding numbers for their own sake, the company also revealed it would add two new popular coins: bitcoin cash (BCH) and ether (ETH). The technical picture on Bitcoin looks bullish.

Trading recommendations:

According to the H1 time - frame, I found that price broke the downward channel in the background, which is sign that buyers are in control. I also found a potential end of downward correction (abc) in the background, which is another sign of strength. My advice is to watch for potential buying opportunities. The upward targets are set at the price of $7.771 and at the price of $8.103.

Support/Resistance

$7.560 – Intraday resistance

$7.460– Intraday support

$7.771 – Objective target 1

$8.103 – Objective target 2

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The single European currency can further improve its positions for today due to quite significant macroeconomic data. Therefore, the unemployment rate should decrease from 8.5% to 8.4%, which is already quite good. But more importantly, a preliminary estimate may show an increase in inflation from 1.2% to 1.6%. Such a significant increase in inflation will clearly inspire market participants and hope that the ECB will abandon the idea of extending the quantitative easing program. The dollar has nothing to cover so serious data. The growth of personal incomes and expenses by 0.3% and 0.4% respectively, of course, the case is good but not as significant as the level of unemployment and inflation. The number of applications for unemployment benefits will remain virtually unchanged, an increase of only 2,000.

The EUR / USD currency pair has finally moved into the long-awaited correction, feeling the support near the level of 1.1500. It is possible to assume that the first coordinate, which can serve as a stop at1.1720, reflecting the periodic level in the cluster with the Fibo value of 23.6. In the case of fixation above 1.1730, we will open higher coordinates at 1.1800 / 1.1830. Otherwise, there will be a wobble at 1.1650 / 1.1720.

Recently, Gold has been trading upwards. As I expected, the price tested the level of $1,305.90. According to the H1 time – frame, I found that there is a finished (abc) bearish correction in the background, which is a sign that selling looks risky. I also found an intraday bullish flag and upward channel, which is a sign that buyers are in control. My advice is to watch for potential buying opportunities. The upward target is set at the price of $1,316.60.

Bitcoin has been quite impulsive with the bullish gains today after certain indecision and bearish pressure recently. Though the bullish pressure is not quite as expected, the impulsive pressure was expected to push higher towards $8,000 sooner. The price of Bitcoin has been correcting itself below $8,000 for a few days now which indicates and explains the weakness of bears in the process. As for the recent rumors haunting the market participants, meanwhile big investors like George Soros is already active in the market.

As for the current scenario, the price is still quite ambitious to proceed higher towards $8,000 area. If broken, it will proceed much higher towards $10,000 in the future. The market has not been able to meet the impulsive expectation recently. As the price breaks above $8,000 with a daily close, it is expected to attract the impulsive buyers in the market again.

GBP/JPY has been quite impressive with the recent bullish gains which lead the price to reside above 145.00 area after being impulsively bearish with a break. GBP has been struggling for gains against JPY whereas recent JPY economic reports helped GBP to gain certain momentum for a while.

Today, Japan's Prelim Industrial Production report was published with a decrease to 0.3% from the previous value of 1.4% which was expected to increase to 1.5% and Housing Starts report showed a significant increase to 0.3% from the previous negative value of -8.3% which was expected to increase in deficit to -8.8%. Moreover, recently BOJ Governor did not give any clues about an immediate positive economic impact on the domestic economy from the stimulus programs in his recent speech.

On the other hand, today the UK Net Lending to Individuals report was published with an increase to 5.7B from the previous figure of 4.4B which was expected to be at 5.2B, M4 Money Supply report was published with an increase to 0.2% from the previous negative value of -1.4% which was expected to be at -1.1%, and Mortgage Approvals report was published with a slight decrease to 62k which was expected to be unchanged at 63k.

As for the current scenario, GBP has been quite positive with the economic reports today which is expected to lead to further gains against JPY in the short run. Though JPY has been quite mixed amid the recent economic reports, current sentiment on GBP is quite optimistic which resulted in certain impulsive bullish pressure in the pair.

Now let us look at the technical view. The price is currently residing above 145.00 area with an impulsive bullish pressure in the intraday charts. After the break below 145, certain bullish impulsive pressure leading the price to reside above 145 again has qualified the previous breakout below as False and as of the False Breakout Structure the price is expected to push against it, resulting to further bullish pressure with target towards 148.50 area in the future. As the price remains above 143.00 area, the bullish bias is expected to continue.

Fundamental Overview: Earlier data shows The euro zone's annual rate of inflation rose more sharply than expected in May as energy prices increased, a development that will likely reinforce the European Central Bank's belief that the metric will return to its target over coming years. The European Union's statistics agency today said consumer prices in the 19 countries that use the euro were 1.9% higher than in May 2017, a jump from the 1.2% rate of inflation recorded in April, the highest level since April of last year.

Chart Explanation: The black line shows the pivot point. Currently, the price is above the pivot point which is a signal for long positions. If it remains below the pivot point, it will indicate short positions. The red lines show the support levels, while the green line indicates the resistance levels. These levels can be used to enter and exit trades.

Recently, the GBP/USD pair has been trading upwards. The price tested the level of 1.3346. Anyway, according to the H1 time – frame, I still expect downward continuation. I have found a potential bearish flag in creation, which is a sign that buying looks risky. My advice is to watch for a potential breakout of the support trendline to confirm further downward continuation. The downward target is set at the price of 1.3200.

On the daily scale of the Swiss currency major, the dominant wave is directed downward. In a larger model, this section of the graph closes the correction part (B). The subsequent counter-rising movement has the potential for a reversal.

The wave pattern of the H1 graph:

In the bullish wave of February 16, the price was adjusted for the whole last month. The wave is not complete. By now it has reached the smallest possible size, but the structure has not yet completely formed.

The wave pattern of the M15 chart:

In the framework of the main downward wave, a counter-roll began to form from May 29. In the coming days, its completion is expected.

Recommended trading strategy:

When trading large sections of the schedule, traders need to wait for the completion of the entire bearish correction. With inter-dynamic trade style from the resistance zone, short-term sales are possible.

Resistance zones:

- 0.9930 / 0.9980

Support zones:

- 0.9770 / 0.9720

Explanations to the figures:

A simplified wave analysis uses a simple waveform, in the form of a 3-part zigzag (ABC). The last incomplete wave for every timeframe is analyzed. Zones show the calculated areas with the greatest probability of a turn.

Arrows indicate the counting of wave according to the technique used by the author. The solid background shows the generated structure and the dotted exhibits the expected wave motion.

Attention: The wave algorithm does not take into account the duration of the tool movements in time. To conduct a trade transaction, you need to confirm the signals used by your trading systems.

The price zone (1.1520-1.1415) is considered a prominent Demand zone to be watched for bullish price action and valid BUY entries. Early signs of bullish rejection have already been expressed around 1.1510 (within the depicted demand zone).

On the other hand, conservative traders should wait for bullish pullback towards the price zone (1.1850-1.1750) for bearish rejection and possible SELL entries if the current bullish pullback persists.

The price zone of 0.7320-0.7390 stood as a significant supply zone during recent bullish pullback. The bulls failed to execute a successful Bullish breakout above 0.7400 during the previous week's consolidations.

The NZD/USD pair had been trapped between the price levels of 0.7170 and 0.7350 until bearish breakdown of 0.7200 occurred.

Since April 13, significant bearish pressure has been applied. This probably turns the short-term outlook for the NZD/USD pair into bearish giving considerable significance to the multiple-top reversal pattern.

The bearish scenario needs obvious bearish persistence below 0.7050 to maintain significant bearish momentum towards 0.6860 and 0.6820. That's why, the price level of 0.7050 is currently considered a key-level for the NZD/USD bears.

On the other hand, if bearish momentum persists, the price zone of 0.6820-0.6780 will be the next destination for the NZD/USD pair. It should be watched for bullish rejection and a possible valid BUY entry.

Any bullish pullback towards the price level of 0.7050 (Broken Demand-Level) should be watched for a valid SELL entry. S/L should be placed above 0.7100.

In the morning, data on housing prices in the UK already showed that the rate of price growth slowed from 2.6% to 2.4%, although they expected acceleration to 3.0%. However, the pound has the potential for growth, as it is expected to increase consumer lending by 1.3 billion pounds from 0.3 billion pounds a month earlier. Also, the number of approved applications for mortgages may reach 63,000 against 62,914. All this characterizes the growth of consumer activity, which will have a beneficial effect on the pound. Nevertheless, the dollar will be able to resume its growth by the evening, as the data on personal incomes and expenses should show an increase of 0.3% and 0.4% respectively. Spending grew at best for quite a long time on the same rate as income, and sometimes more slowly. This frightened investors by the fact that consumer activity may decline after inflation. So the outstripping growth of expenses will somewhat reduce the fears of investors. In turn, the expected increase in the number of applications for unemployment benefits by 2,000, which is too small to have a serious impact on the market. Moreover, on the eve of tomorrow's publication of the report on the applications data of the Ministry of Labor, very few people will be interested.

The GBP/USD currency pair felt a periodic support near the value of 1.3200, which resulted in a rollback to the previous level of 1.3300. We can assume a temporary bump within the level of 1.3270/1.3330 with further analysis of fixations.

GBP/USD is expected to trade with bullish outlook The pair stands firmly above its horizontal support at 1.3265, which should limit any downside room. Besides, the prices are also supported by a rising trend line. A bullish cross has been identified between the 20-period and 50-period moving averages, which confirms a positive outlook. Therefore, as long as 1.3265 is not broken, expect a new rise to 1.3340 and 1.3380 in extension.

Fundamentals:

Earlier data shows the amount Britons borrowed strongly rebounded in April, after a bout of weakness in March, in a signal that may strengthen the Bank of England's case for raising its key interest rate in the months to come. Figures released on Thursday showed the sharpest U.K. consumer-credit increase in almost 18 months, despite recent economic data releases signaling a torpid economic growth. The amount U.K. consumers borrowed in April jumped to GBP 1.8 billion after falling to GBP 400 million in March, which was the lowest rate in more than five years, the Bank of England said. The increase was driven by both credit-card spending and loan uptakes.

Chart Explanation: The black line shows the pivot point. The present price above the pivot point indicates a bullish position, and the price below the pivot point indicates a short position. The red lines show the support levels, and the green line indicates the resistance levels. These levels can be used to enter and exit trades.

14.00 London time. USD, the index of unfinished sales in the real estate market (m / m) (Apr), the expected value is 1.1%, the previous value of 0.4%;

15.00 London time. USD, crude oil reserves, the expected value is 2.214M compared to the previous value of 5.778M.

Trend analysis (Figure 1).

On Wednesday, the price moved down and almost reached 50.0% of the recession level 1.3179 (blue dotted line), but traders started fixing their profits too early, after which the price went up. On Thursday, the price will most likely continue to move up. A complex analysis will more accurately determine where the price will go next.

Fig. 1 (daily chart).

The system of ADX indicators (Figure 1).

On the last run, the fast line (indicator 5 - white) and the slow line (indicator period 8 - blue) moved up. In this case, the trend should be determined by trend type indicators.

Complex analysis:

- Indicator analysis - up;

- Fibonacci levels - up;

- volumes - upwards;

- candlestick analysis - up;

- trend analysis - up;

- Bollinger lines - down;

- Weekly schedule - down.

General conclusion:

On Thursday, the GBP / USD pair will move upward towards the first goal at 1.3374 (yellow dotted line) with a recoil level of 14.6%.

- 14.00 London time. USD, the index of unfinished sales in the real estate market (m / m) (Apr), the expected value is 1.1%, compared to the previous value of 0.4%;

- 15.00 London time. USD, crude oil reserves, the expected value is 2.214M compared to the previous value of 5.778M.

Trend analysis (Figure 1).

On Wednesday, the price went up and safely reached the pullback level of 14.6% 1.664 (blue dotted line), as expected after reaching the support line. On Thursday, the upward movement will most likely continue. A complex analysis will more accurately determine where the price will go next.

Fig. 1 (daily chart). \

Complex analysis:

- Indicator analysis - up;

- Fibonacci levels - up;

- volumes - upwards;

- candlestick analysis - up;

- trend analysis - up;

- Bollinger lines - up;

- Weekly schedule - down.

General conclusion.

On Thursday, the market will move up towards the first target of 1.1757 with a recoil rate of 23.6% (blue dotted line).

On the weekly timeframe of the instrument, the price goes beyond the red balance sheet line with the support of the ascending signal line of the Marlin oscillator and this line develops above the zero line of the oscillator (1.4190). From the perspective of this scale, the first growth target may be the October maximum of last year at the range of 59.66-60.12. Overcoming of this range will indicate the second target at the upper line of the price channel, approximately at the level of 61.30.

The daytime timeframe also showed a buying signal. The price was fixed above the balance line (red on the chart) and the signal line of the Marlin oscillator acquired a positive value (0.2241), which indicates the consolidation of the trend towards growth.

* The presented market analysis is informative and does not constitute a guide to the transaction.

The US Dollar Index has finally formed an engulfing bearish candlestick pattern yesterday as seen on the daily chart presented here. The index is following through well even today and should continue dropping towards 92.50/70 levels going forward. Please note that the index remained just shy of breaking above 95.00 resistance levels before pulling back sharply yesterday. It looks that the index is all set to retrace lower towards 92.50/70 levels before resuming its rally towards 98.00 levels. Looking into the wave counts, the index has completed waves (1) through (3) and is now already on to its way towards wave (4) lower. Also note that fibonacci 0.382 support is also seen through the same price as 92.50.70 according to the channel line support shown here. If this count holds to be true, we shall expect the index to drop lower into wave (4) near the channel support before resuming higher again.

The Bank of Canada kept interest rates at the current level (1.25%), but the prospects for future tightening were outlined in a more pronounced language. The Bank of Canada removed "cautious" from the monetary policy statement, suggesting a slightly less data-dependent approach to policy normalization. It means the July interest rate hike might be almost certain and it was somewhat confirmed in this passage from the BoC Monetary Policy Statement: "This should lead the market to price in a July hike with more conviction." Another very interesting quote from the statement: "Furthermore, clarification of the reasoning behind the change will likely come from BOC officials ahead of the July meeting, which could provide further hawkish surprises" might be seen as one more confirmation of a very possible interest rate hike in June.

Considering slightly worse data and considerable uncertainty regarding the future of the NAFTA agreement, this should be interpreted in the categories of a big surprise.

Let's now take a look at the USD/CAD technical picture at the H4 time frame. In the initial reaction, the price of USD/CAD drops from 1.3045 to 1.2944 and this move is being continued further. Currently, the price has broken below all of the intraday supports and it might be heading towards the next technical support at the level of 1.2742. Any violation of the level of 1.2730 would indicate the bears have now a full control over the market and the key technical support at the level of 1.2526 might be challenged soon.

On Wednesday, the focus was on data on consumer inflation. An unexpected result of the price dynamics in the US and Germany provoked a correction in the euro.

The first data came from retail sales in Germany for the month of April, which turned out to be unexpectedly strong at 2.3% up against the forecast of 0.7%. Then, the European Commission presented its view on the business climate in the eurozone, which also turned out to be better than expected. Consumer prices in Germany rose by 2.2% in April, which was a complete surprise, since a month ago growth was zero.

At the same time, the revised data from the US for the first quarter were significantly worse than expected. GDP growth was revised from 2.3% to 2.2%. The basic index of personal consumption expenditure fell from 2.5% to 2.3% and the price index was lowered. Collectively, these data indicate that inflation growth may not be strong enough to justify high growth rates of the Fed rate, which casts doubt on the likelihood of a fourth rate hike in December and, as a result, reduces demand for the dollar.

ADP reported on the growth of jobs in the private sector. The result of +178 thousand was below the forecast of 190 thousand, and thus, is a conditions for corrective growth in the main currency pair.

Until the end of the week, there may be an increase in volatility, since both Thursday and Friday are quite saturated with macroeconomic news. Today, there will be preliminary data on inflation in the eurozone for the month of May, as well as price indices for personal spending and income in the US for April, which can significantly adjust inflation expectations. Tomorrow, the same report will be published on the US labor market for May, which will give an opportunity to assess how confident the Fed will feel at the key meeting on the rate that will take place after 2 weeks.

The euro is likely to continue corrective growth. The end of the week is likely to reach the level of 1.1790. The further dynamics will be determined by the report on the US labor market.

United Kingdom

Brexit did not follow the same scenario as was planned. Such a conclusion needs to be drawn from the news in preparations for the second referendum on EU membership that will begin soon. The UK obviously does not receive any benefits from withdrawing from the EU, as capital flows indicate a drop in confidence in the pound and the stability of the British economy as a whole.

The pound, unlike the euro, will remain under pressure until the end of the week, as no important macroeconomic news is expected, and even weak data from the US could not provoke a correction. It is possible to rise to 1.3325, after which sales will most likely resume.

Oil

Despite the fact that the balance of supply and demand efforts of OPEC + has been significantly corrected, new data indicate that the struggle for control over the oil industry can resume with renewed vigor.

OPEC Secretary General Mohammed Barkindo said on Tuesday that it is necessary to increase investment in the oil industry in order to avoid supply shortages in the near future. This statement added weight to the earlier plans of Russia and Saudi Arabia to start considering the issue of increasing oil production already in the near future, as the OPEC + deal fulfilled its role and the balance as a whole was restored.

At the same time, the United States has reached a clean second place in the world in terms of production, and intends to increase it further. It seems that the main oil-producing countries will proceed from this meaning that the world has entered a phase of economic growth and oil consumption will grow with ever-increasing speed.

Quotes are recovering again after correction last week, the probability of re-testing is $ 80 per barrel. For Brent, it looks higher but the bull scenario is unlikely to resume until the OPEC + meeting in the second half of June. Short-term trading is more likely in the range of 76/79 dollars per barrel.

The struggle for the formation of an interim government continues in Italy (the "5 star" party convinces Paolo Savona, who was nominated by the president for the post of Minister of Finance, to give up the job for the formation of the government), while investors managed to work out unfavorable for the dollar macroeconomic indicators that was released on Wednesday. German retail sales in April increased by 2.3% against expectations of 0.5%. The number of unemployed in Germany decreased by 11 thousand against the forecast of -10 thousand, and the unemployment rate fell from 5.3% to 5.2% with the expectation of the figure unchanged. The production mood of the euro area for May was 6.8 against expectations of 6.7. France's GDP in the first quarter came in at 0.2% against the forecast of 0.3%, but GDP increased from 2.1% to 2.2% in an annualized basis.

In the United States, the figures came out worse than expected. The second evaluation of US GDP for the 1st quarter was revised downwards to 2.2%, instead of the potential upward revision, versus expectations of 2.3%. In the private sector, 178,000 jobs were created in May against expectations of 191,000. Wholesale inventories in commercial warehouses showed zero growth in April against expectations of 0.4%. The positive side came from foreign trade, as the April balance came at -68.2 billion dollars against the forecast of -71.2 billion. As a result, the single European currency added 125 points.

But the report of regional federal banks ("Beige Book") showed that the economic growth is quite stable ("accelerates and slows down"), the growth of wages is stable in connection with the goal of employers to attract qualified personnel. It is believe that this performance will continue for some time. Currently. the growth period of those economic sectors have a long production cycle and have not yet managed to show the effect of the tax reform.

Today, the CPI for the month of May will come out in the euro area. The base indicator is expected to increase from 0.7% YoY to 1.0% YoY, while the total CPI is expected to increase from 1.2% YoY to 1.6% YoY. Also, the unemployment rate in the euro area can show a decline from 8.5% to 8.4%. The United States also predicts good performance. Personal incomes of consumers in April are expected to increase by 0.3%, and personal expenses by 0.4%. Unfinished sales in the secondary real estate market in April are expected to increase by 0.4%. The business activity index in the manufacturing sector of the Chicago region for May is projected to grow from 57.6 to 58.2. The number of applications for unemployment benefits is expected at 228 thousand against 234 thousand a week earlier. Also, investors are already waiting for tomorrow's data on new jobs outside the agricultural sector, with a forecast of 189 thousand against 164 thousand in April. The stock market is the indicator of optimism here, as the S & P500 index added 1.27% yesterday. We are expecting for the euro to return to 1.1510 and further decline to 1.1450.

* The presented market analysis is informative and does not constitute a guide to the transaction.

The ADP Non-Farm Employment Change data published yesterday had indicated, that in May in the private sector of the American economy, the number of jobs increased by 178,000. That's less than the consensus (190,000), but still a decent figure. At the same time, the previous reading has been revised downwards (from 204,000 to 163,000). A decent rate of creation of new jobs is not shocking anyone. It also seems that with such low unemployment (below 4%), the pace of employment growth must finally slow down. Therefore, the key carrier of information on the condition of the labor market, especially in the context of the Fed's policy outlook, is the growth of wages. This data, of course, we will get to know on Friday, but already the secret of the power of broader trends has been abolished by the Beige Book of the Fed containing a description of the economic situation in individual regions.

The Beige Book prepared for the 12-13 June FOMC meeting, covering information through 21 May, indicated few material changes in the trajectory of economic growth in most districts. A large number of districts reported acceleration in manufacturing and industrial activity, but the outlook for employment and wage growth was largely unchanged with most districts reporting moderate increases in employment but only modest increases in wages.

It looks like the global investors will have to wait for the Friday's Non-Farm Payrolls data to make themselves more familiar with the latest details in the US job market direction.

Let's now take a look at the SP500 technical picture at the H4 time frame. The market remains locked in a horizontal zone between the levels of 267.96 - 274.15 in neutral market conditions. This consolidation might take some time as the broader technical pattern that is being formed at the larget time frames looks like a triangle. The key level to the upside is still the zone between the levels of 274.15 - 273.42. The key technical support is seen at the level of 259.36.

The EUR/USD pair has finally produced an engulfing bullish candlestick pattern on the daily chart as presented here. As expected, the pair is now poised to stage a counter trend rally towards the 1.1950-1.2050 handle in the next few days. The Elliott channel resistance is also seen around the same region by June 06, 2018. Please note that the corrective rally is expected to be a zigzag corrective move, since the current raise through 1.1689/90 looks to be an impulse push. Looking into the wave counts, it is now quite clear that EUR/USD has completed the waves (1) through (3) and is towards the wave (4) corrective rally through the near-term resistance at the 1.1950-1.2050 levels. Also note that the downward trend remains intact till the prices stay below the 1.2150 levels going forward. Selling on rallies remains a conservative trading strategy.

Trading plan:

Aggressive traders should remain long with stop below the 1.1500 levels, targeting 1.1950 at least.

AUD/JPY has been quite impulsive with the bullish gains recently, after bouncing off the 80.50-81.50 support area with a daily close. After being in a volatile and corrective structure with bearish squeeze along the way, certain bullish engulfing pattern does indicate the upcoming strong bullish pressure in the market.

Despite the worse economic reports on AUD Building Approvals published recently, certain bullish pressure has been quite significant and surprising for the market participants. Today, AUD Private Capital Expenditure report was published with an increase to 0.4% from the previous value of 0.2%, but failed to meet the expectation of 0.8% and Private Sector Credit was published with a decrease to 0.4%, as expected, from the previous value of 0.5%.

On the other hand, today, JPY Prelim Industrial Production report was published with a decrease to 0.3% from the previous value of 1.4% which was expected to increase to 1.5% and Housing Starts report showed a significant increase to 0.3% from the previous negative value of -8.3% which was expected to increase in deficit to -8.8%.

As of the current scenario, AUD has been quite positive with the economic reports in comparison to JPY today which is expected to lead to further bullish gains in the coming days. Though JPY still has the market sentiment on its favor, but recent bullish pressure is expected to sustain the price pushing higher in the coming days.

Now let us look at the technical view. The price is currently residing above the 81.50 area with dynamic level of 20 EMA holding the price as resistance. After the bearish divergence formed recently which pushed the price lower in an impulsive manner, current bullish bias is expected to push the price higher towards the 83.50-84.00 area in the coming days. As the price remains above the 80.50 area, further bullish pressure is expected in this pair.

The US dollar index is breaking below 94 and shows signs of rejection at the Weekly Kumo (cloud) resistance. This justifies a pullback towards 92. This is not the time to be buying dollar but if you are bullish, you'd better wait for a pullback. I prefer to be short on the dollar.

Black line - horizontal resistance

The Dollar index reached the previous high where the black horizontal line is drawn. There was a confluence of previous high and cloud resistance at that area and bulls got rejected at that area. I believe the entire move from the 2018 lows to 95.20 is complete and we should see a resumption of the down trend in the US dollar index. The important weekly support is at 92. A break below it will open the way for new 2018 lows.

Singapore's Monetary Office (MAS), the de facto central bank of a city-state, proposes changes to existing laws that would facilitate the entry of decentralized Blockchain-based exchanges.

According to the published document, MAS claims that the current, single-level legal framework of "recognized market entities" (RMO) is not able to meet the demand for new business models based on new technologies. To solve this problem, the authority proposes the introduction of a three-tier structure to facilitate market access for small-scale platforms: "MAS has observed the emergence of new business models in transactional platforms, including commercial facilities using Blockchain technology or platforms that enable P2P exchange without the participation of intermediaries. [...] As the current RMO regime has existed since 2002, the regulatory framework for market actors needs to be revised to ensure that they continue to meet the requirements of a changing landscape" we can read in the official report.

In particular, the level 3 of the proposed rules apply to market participants that are significantly smaller than well-established stock exchanges. Its purpose is to enable the implementation of Blockchain and P2P technology and the introduction of services in the supervised environment: "This new level is aimed at facilitating new market participants who develop solutions for wholesale market participants or business entities who have left the sandbox and are profitable, but whose enterprises are unable to meet the requirements of the existing RMO system" - explains MAS.

Let's now take a look at the Bitcoin technical picture at the H4 time frame. The price is about to test the golden trend line from below around the level of $7,700. In a case of a breakout, the next target for bulls is seen at the level of $7,890 and $7,977. The immediate support is seen at the level of $7,435, the key support is still at swing low at the level of $6,984. The growing bullish divergence between the price and the momentum oscillator supports the bullish outlook.

The US dollar fell under "distribution" on Wednesday on a wave of several reasons, which became the reason for profit taking after the resumption of the rally.

It all started with the morning news that a new American delegation of negotiators will come to Beijing on Wednesday to resume discussions on the topic of the new US tax duties against China. This raised hopes that Washington would still be able to reach an agreement with Beijing. After Tuesday, it was announced in the States that the news of the publication on June 15 of the list of goods, as well as technology, which will be introduced with duties of 25% and a total volume of 50 billion dollars. On Wednesday, relief came.

In the world markets, this news was perceived as positive and became the reason for the growth in demand for risky assets. This led to an increase in the yield of US government bonds, a certain easing of the yen, and sell-offs of the US dollar. The yield of the benchmark of 10-year-old Treasuries in the moment grew more than 3.6% for the day, having risen from the opening level of 2.763% to 2.857%. On this wave of the weakening of the dollar, crude oil prices have sharply increased, which remained under pressure for the last few days due to expectations for an increase in crude oil production by Russia and Saudi Arabia and the strengthening of the US dollar.

The disclosure of weaker data on the number of new jobs from ADP and the second revision of US GDP for the first quarter downward from 2.3% to 2.2% also became the basis for the beginning of fixing the wound to the dollar profit.

The question arises, is there really a real opportunity to agree to the two countries with the largest economies in the world?

In our opinion, it's too early to be happy, as they say. The first round of talks, judging by the reaction of D. Trump, the US president, was unsatisfactory for him. The second one will be known either today or tomorrow. Assessing the president's desire to get more than he really can will cause the failure of the talks or he will have to significantly reduce his appetites, which the US establishment may already not like. Because of this we now have expectations to solve the old trade deficit problems by force. In this case, we should expect the beginning of a full-scale trade war with all the ensuing disadvantages. And what they can be, we have already observed on Tuesday.

Forecast of the day:

The EURUSD pair remains in the short-term downtrend. If there is no positive news from the meeting of the Chinese with the Americans, we can expect the pair to turn down towards 1.1515.

The GBPUSD pair is trading below the 1.3300 level. The pair may also turn down for the same reasons as the eurodollar and fall again to 1.3200.

According to the UK, there was no news on Wednesday and the pound sterling was quite calm watching the correction of the dollar, as the US dollar index dropped 0.81% and the pound added 38 points. Expectations on the economic data of Britain for today can be determined moderately optimistic. The number of issued permits for mortgage lending in April is expected at 63 thousand approximately in March level. The net volume of new loans granted to individuals is expected to increase from 4.2 billion in March to 5.2 billion pounds. The residential property price index for May is expected to grow by 0.2% -0.3% (year-on-year growth from 2.6% to 3.0%).

In the evening, important data on the United States will come out. The number of applications for unemployment benefits is expected at 228 thousand compared to 234 thousand a week earlier. Personal incomes of consumers in April are expected to grow by 0.3%, while personal expenses may increase by 0.4%. Business activity in the manufacturing sector of the Chicago region for May is projected to increase from 57.6 to 58.2.

There is still a slight increase in the pound sterling (1.3330), after which we expect a decline in the range of 1.3225 / 45 and further into the range of 1.3135 / 65.

* The presented market analysis is informative and does not constitute a guide to the transaction.

Gold price is ready for a move higher towards $1,320-$1,330. It is breaking above the medium-term resistance trend line and should rally for at least a few days. I remain bullish on gold.

Purple line - short-term support

Yellow line - medium-term resistance

Green horizontal lines - targets

Gold price is moving above the yellow trend line resistance respecting the purple line support. Gold is making higher highs and higher lows. The precious metal has started a reversal off the $1,280 area where the 61.8% Fibonacci retracement of the rise from $1,236. Gold is expected to move strongly upwards from now on towards our minimum $1,320-30 target area.

There wasn't a lot of a movement during the Asian session today as the month of May is getting close to the end. We got some relevant news and data hitting but despite this moves in the currency market were minor only. Early on a report in US media that President Trump is set to impose metals tariffs on Mexico, Canada and Europe as soon as Friday, the official announcement expected on Thursday. MXN lost ground but CAD and EUR didn't move nearly so much.

The German inflation data beat the expectations. The harmonized measure of consumer inflation reached the value of 2.2% higher than a year ago (previously 1.4% y/y). The prices were as much as 0.6% higher than in April. The reading is high, but it was expected after good data from several German zones (CPI increased from 0.4 to 0.7% m/m). This kind of inflationary pressure data is very welcomed by the ECB President Mario Draghi.

Let's now take a look at the EUR/USD technical picture at the H1 time frame. The positive data release was behind the recent bounce in the price of Euro above the navy trend line. The bulls have managed to break out above the 1.1661 level and now the market should head towards the next technical resistance at the level of 1.1710 - 1.1726 zone. The immediate support is seen at the level of 1.1644, but the key support is still at the swing bottom at the level of 1.1509.

Political turmoil in Europe and Asia was quieted down a bit yesterday, which supported the Japanese yen to increase by 16 points. The US stock index S & P500 added 1.27% yesterday, but it was only the first day of growth after the decline in the previous week. So the market does not yet feel a stable external support. Also on Wednesday, retail sales in Japan increased by 1.6% in April against expectations of 0.9%, and the household confidence index in May increased from 43.6 to 43.8 (the forecast was 43.9). But today, the April estimate for industrial production showed 0.3%growth only against the forecast of 1.5%. Chinese investors' sentiment on business activity (PMI) slightly supports the mood of investors. Manufacturing PMI in May increased from 51.4 to 51.9, and Non-Manufacturing PMI rose from 54.8 to 54.9. The Chinese index of China A50 increase today at 1.87%, and the Japanese index Nikkei 225 came at 0.59%. In the coming days, we expect the yen to rise to 110.05.

* The presented market analysis is informative and does not constitute a guide to the transaction.

For Gold, the key levels on the H1 scale are: 1316.66, 1311.26, 1308.97, 1305.28, 1302.58, 1295.70 and 1288.63. Here, the price is in deep correction from the upward structure of May 21. The continuation of the price movement towards the top is expected after the breakdown of 1302.60. In this case, the target is 1305.00. In the area of 1302.58 - 1305.00 is the consolidation of the price. The breakdown at the level of 1305.60 should be accompanied by a pronounced movement towards the level of 1308.97. In the area of 1308.97 - 1311.26 is the consolidation of the price. For the potential value for the top, consider the level of 1316.66. Upon reaching this level, we expect a pullback to the bottom.

The level of 1295.70 is the key support for the top. Its breakdown will lead to the development of a downward trend. Here, the target is 1288.63. Up to this level, we expect the formulation of pronounced initial conditions for the downward cycle.

The main trend is the upward cycle from May 21, the stage of deep correction.

For the EUR / USD pair, the price forms a potential for the upward cycle of May 30 which is in correction. For the GBP / USD pair, the continuation of the movement towards the bottom is expected after the breakdown of 1.3195. For the USD / CHF pair, the subsequent goals for the downward movement were determined from the local structure on May 29. For the USD / JPY pair, the continuation of the movement towards the bottom is expected after the breakdown of 108.14. For the EUR / JPY pair, the price is in correction from the downward structure on May 22 and forms the potential for the top. For the GBP / JPY pair, the level of 146.27 is the key support for the downward cycle.

Forecast for May 31:

Analytical review of currency pairs in the scale of H1:

For the EUR / USD pair, the key levels on the scale of H1 are: 1.1824, 1.1774, 1.1743, 1.1693, 1.1622, 1.1593, 1.1562, 1.1515, 1.1453 and 1.1397. Here, the price has set a small potential for the top of May 30. The continuation of the price development of the upward trend is expected after the breakdown of 1.1693. In this case, the target is 1.1743. In the area of 1.1743 - 1.1774 is the consolidation of the price. For the potential value for the top, consider the level of 1.1824. Upon reaching this level, we expect a pullback to the bottom.

Short-term downward movement is possible in the area of 1.1622-1.1593. The breakdown of the last value will lead to in-depth correction. Here, the target is 1.1562. This level is the key support for the upward structure from May 30. Its breakdown will lead to the development of the a downward structure. In this case, the first goal is 1.1515.

The main trend is a local structure for the bottom of May 14, the formation of the potential for the top of May 30.

Trading recommendations:

Buy: 1.1695 Take profit: 1.1742

Buy 1.1775 Take profit: 1.1822

Sell: 1.1622 Take profit: 1.1593

Sell: 1.1560 Take profit: 1.1515

For the GBP / USD pair, the key levels on the scale of H1 are 1.3415, 1.3388, 1.3346, 1.3306, 1.3229, 1.3195 and 1.3123. Here, we continue to follow the downward structure from May 14. The continuation of the movement towards the bottom is expected after passing the price of the noise range at 1.3229 - 1.3195. In this case, the target is 1.3123. Upon reaching this level, we expect a rollback to the top.

Short-term upward movement is possible in the area of 1.3306 - 1.3346. The breakdown of the last value will lead to in-depth correction. Here, the target is 1.3388. The level of 1.3415 is the potential for the top. Upon reaching this level, we expect the initial conditions for the upward cycle to be formalized.

The main trend is the downward cycle from May 14.

Trading recommendations:

Buy: 1.3306 Take profit: 1.3344

Buy: 1.3348 Take profit: 1.3388

Sell: 1.3227 Take profit: 1.3196

Sell: 1.3193 Take profit: 1.3125

For the USD / CHF pair, the key levels in the scale of H1 are: 0.9981, 0.9954, 0.9927, 0.9910, 0.9865, 0.9842 and 0.9787. Here, we determined the subsequent goals from the local top-down structure on May 29. Short-term downward movement is possible in the area of 0.9865 - 0.9842. The breakdown of the last value will allow us to count on the movement towards the potential target of 0.9787. Upon reaching this level, we expect a pullback to the top.

Short-term upward movement is possible in the area of 0.9910 - 0.9927. The breakdown of the last value will lead to in-depth correction. Here, the target is 0.9954. This level is the key support for the downward structure. Its breakdown will allow us to count on the movement towards 0.9981.

The main trend is a local downward structure from May 29.

Trading recommendations:

Buy: 0.9910 Take profit: 0.9925

Buy: 0.9930 Take profit: 0.9954

Sell: 0.9865 Take profit: 0.9844

Sell: 0.9840 Take profit: 0.9790

For the USD / JPY pair, the key levels on a scale are: 109.98, 109.60, 109.15, 108.84, 108.14, 107.64, 106.99 and 106.58. Here, we follow the downward structure of May 21. The continuation of the movement towards the bottom is expected after the breakdown of the level of 108.14. In this case, the target is 107.64. Near this level is the consolidation of the price. The breakdown of 107.62 must be accompanied by a pronounced movement towards the level of 106.99. For the potential value for the bottom, consider the level of 106.58. Upon reaching this level, we expect a rollback to the top.

Short-term upward movement is possible in the area of 108.84 - 109.15. The breakdown of the last value will lead to in-depth correction. Here, the target is 109.60. The level of 109.98 is a potential value for the top. Upon reaching this level, we expect the initial conditions for the upward cycle to be formalized.

The main trend is the downward structure of May 21.

Trading recommendations:

Buy: 108.84 Take profit: 109.12

Buy: 109.17 Take profit: 109.60

Sell: 108.12 Take profit: 107.66

Sell: 107.62 Take profit: 107.00

For the CAD / USD pair, the key levels on the H1 scale are: 1.3204, 1.3159, 1.3093, 1.3012, 1.2960, 1.2922, 1.2825, 1.2758, 1.2674 and 1.2621. Here, we follow the upward structure of May 22. At the moment, the price is in deep correction from this structure and forms the potential for the bottom of May 29. Short-term upward movement is expected in the area of 1.2922 - 1.2960. The breakdown of the last value will lead to the movement towards the level of 1.3012. This level is the key resistance for the subsequent development of the upward trend.

The development of a downward trend from May 29 is expected after the breakdown of 1.2825. Here, the first target is 1.2758. Near this level is the consolidation of the price. The breakdown of 1.2755 should be accompanied by a pronounced movement towards the potential value of 1.2674.

The main trend is the rising trend from May 22, a deep correction.

Trading recommendations:

Buy: 1.2960 Take profit: 1.3012

Buy: 1.3014 Take profit: 1.3090

Sell: 1.2825 Take profit: 1.2760

Sell: 1.2755 Take profit: 1.2680

For the AUD / USD pair, the key levels on the scale of H1 are: 0.7661, 0.7632, 0.7612, 0.7583, 0.7543, 0.7525, 0.7505 and 0.7474. Here, the price forms the potential for the upward movement of May 30. The continuation of the price movement towards the top is expected after the breakdown of 0.7583. In this case, the target is 0.7612. In the area of 0.7612 - 0.7632 is the consolidation of the price. For the potential value for the top, consider the level of 0.7661. Upon reaching this level, we expect a pullback to the bottom.

Short-term downward movement is possible in the area of 0.7543 - 0.7525. The breakdown of the last value will lead to in-depth correction. Here, the target is 0.7505. This level is the key support for the upward structure. Its breakdown will lead to a downward movement. In this case, the target is 0.7474.

The main trend is the formation of the potential for the top of May 30.

Trading recommendations:

Buy: 0.7583 Take profit: 0.7612

Buy: 0.7632 Take profit: 0.7660

Sell: 0.7541 Take profit: 0.7526

Sell: 0.7505 Take profit: 0.7478

For the EUR / JPY pair, the key levels on the scale of H1 are: 128.16, 127.52, 126.39, 124.83, 123.89, 123.17 and 121.82. Here, we follow the downward structure from May 22. At the moment, the price is in correction and forms a small potential for the top. The continuation of the movement towards the bottom is expected after the breakdown of 124.83. In this case, the target is 123.89. In the area of 123.89 - 123.17 is the consolidation of the price. For the potential value for the bottom, consider the level of 121.82. The movement towards this level is expected after the breakdown of 123.15.

Short-term upward movement as well as consolidation is expected in the area of 126.39 - 127.52. The range of 127.52 - 128.16 is the key support for the downward trend. Upon reaching this level, we expect the expressed initial conditions for the top.

The main trend is the downward structure from May 22, the correction stage.

Trading recommendations:

Buy: 126.40 Take profit: 127.50

Buy: Take profit:

Sell: 124.80 Take profit: 123.90

Sell: 123.15 Take profit: 121.85

For the GBP / JPY pair, the key levels on the scale of H1 are: 147.10, 146.27, 145.04, 144.29, 142.73, 141.63, 140.17 and 139.29. Here, we follow the downward structure of May 18. The continuation of the price movement towards the bottom is expected after the breakdown of the level of 142.73. In this case, the target is 141.63. Near this level is the consolidation of the price. The breakdown of the level of 141.60 should be accompanied by a pronounced movement towards the level of 140.17. For the potential value for the bottom, consider the level of 139.29. From this level, we expect a pullback to the top.

Short-term upward movement is possible in the area of 144.29 - 145.04. The breakdown of the last value will lead to in-depth correction. Here, the target is 146.27. The range of 146.27 - 147.10 is the key support for the downward structure. Upon reaching this level, we expect the initial conditions for the upward cycle to be formalized.

We have presented a weekly chart for DAX to show a bigger picture, in line with what we discussed for the Dow Jones index earlier today. Believe it or not, a potential remains for a meaningful push lower for the indix keeping in line with other major world indices. Let's look at the structure and wave counts in details. The entire rally that began on Feb 08, 2016 from 8,700 levels and went all the way up to 13,500 levels has been labelled into 5 waves making it an impulse wave termination at a very large degree. In January 2018, the index peaked and reversed sharply breaking below its major trend line support and also breaking below immediate price level support at 11,868. That wave has been labelled as wave (1). The following rally unfolded in 3 waves making it corrective in nature, labelled as wave (2) here. If this wave count holds to be true, then we should see a major sell-off in the coming weeks and months.

The GBP/USD daily chart presented here is indicating that the pair might have formed an interim support at 1.3200 handle. This scenario was discussed earlier and possibility for a relief rally is high for now. The pair had earlier broken blow its immediate trend line support as seen here and now it has taken out an important price support at 1.3200 levels as well. The next move should be a rally towards 1.3900-1.4000 handle which lies at the back side of the support turned resistance trend line indicated through an arrow here. A failure for a rally to begin from here could very well bring back prices lower towards 1.3100 levels which is next support in line. Looking at the wave count, the entire drop from 1.4360/70 through 1.3200 levels can be defined as wave (1) and we can expect the pair to resume rally towards wave (2) as shown here.

Trading plan:

Aggressive traders can remain long for now with stop below 1.3200 levels.